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Stock Market Daily Updates: 12 Jan 2021

The market will keep an eye on reports of more stimulus in the forthcoming Union Budget, the crude oil prices, the rupee's move and the US stimulus package, so now in the midst of budget preparation, caution will be necessary in this surge in stocks….

Photo Credit :

1604918944_mFyCRX_2020_11_09T042012Z_1_LYNXMPEGA805K_RTROPTP_4_MARKETS_INDIA_SHARES.JPG

Dear Trader…

Bullish trend was seen, the BSE Sensex and the Nifty Futures hit a record high of 49303.79 points and 14498.65 points, respectively, on the back of robust buying in IT and auto stocks. Today, the start of new week is likely to be positive taking lead from other Asian peers. Traders will be taking encouragement that India's economy is showing decisive signs of a V-shaped recovery in 2021 with the return of consumer confidence, robust financial markets, an uptick in manufacturing and exporters braving it out in the global market with never-say-die spirit.

In January, foreign portfolio investors have invested heavily in the equity segment. According to available data, between January 1st and 11th, FIIs invested Rs 12403.12 crore in the equities segment and sold Rs 7488.42 crore by the domestic funds in same segment; that means the steady influx of foreign funds led to a rally on the back of a positive report of the corona vaccine in the Indian stock market.

As mentioned in the earlier, today’s move was mainly propelled by the IT and Auto stocks; whereas banking remained slightly on the back foot. Traders should look to identify such appropriate themes and we reiterate that it’s better to keep booking profits in the ongoing rally, because every now and then, we are likely to see stock specific correction in the market.

Friends, the Indian stock market has been in the overbought zone for a long time but corona cases are declining and on the other hand one positive news after another about corona vaccine is coming which has kept the market bullish. The next boom in the market will be largely based on FII purchases.

The chart pattern suggests that if Nifty crosses and sustains above 14474 levels it would witness buying which would lead the index towards 14505-14575 levels. However if index breaks below 14404 level it would witness selling which would take the index towards 14373-14303. 

Nifty is trading above 50, 100 and 200 day SMA's which are important short term moving average, indicating positive bias in the short to medium term. Nifty continues to remain in an uptrend in the medium term, so buying on dips continues to be our preferred strategy.

For the week, The Indian stock market will depend on whether foreign institutions book profits before the central budget or maintain the buying environment, also the market will keep an eye on reports of more stimulus in the forthcoming Union Budget, the crude oil prices, the rupee's move and the US stimulus package, so now in the midst of budget preparation, caution will be necessary in this surge in stocks. We expect Nifty to trade in the range of 14303-14575 with a positive bias.

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Ø INDEX MOVEMENT - 12.01.2021

  • Nifty Future closed @ 14488 as on 11.01.2021

Nifty Future has resistance at 14505 – 14533 Point; above which other resistance levels are at 14575 – 14606 Point with highly Volatile Trend,

Nifty Future has Downside support levels are at 14444 – 14404 Point; below14404 Point, other support levels are at 14373 – 14333 Point.

I am positive for the next bullish trend only above @ 14505 Point but be with the trend. Let the market decide further moves.

As we are saying from many days, Buying is suggested in falls only...and it’s still a better strategy in the given Scenario.

Regarding Long term positions, it is preferable to remain cautious now.

If Nifty Future crosses @ 14505 Point, again then the upper side target is quite high and it may touch @ 14533 Point in the short term.

Note :- Before Act please refer & agree Terms & conditions, Disclaimer, privacy policy & agreement on www.nikhilbhatt.in

  • Bank Nifty Future closed @ 32096 as on 11.01.2021

Bank Nifty Future has resistance at 32132 – 32202 Point; above which other resistance levels are at 32272 – 32303 Point with highly Volatile Trend,

Bank Nifty Future has Downside support levels are at 32008 – 31888 Point; below31888 Point, other support levels are at 31808 – 31737 Point.

I am positive for the next bullish trend only above @ 32303 Point but be with the trend. Let the market decide further moves. 

As we are saying from many days, Buying is suggested in falls only...and it’s still a better strategy in the given Scenario...!!!

Regarding Long term positions, it is preferable to remain cautious now.

If Bank Nifty Future crosses @ 32303 Point, again then the upper side target is quite high and it may touch @ 32373 Point in the short term.

Note :- Before Act please refer & agree Terms & conditions, Disclaimer, privacy policy & agreement on www.nikhilbhatt.in

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.


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Nikhil Bhatt | Research Analyst - SEBI

The author is a well established entrepreneur having a more than 16 years of experience in the field of stock market and financial management.

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